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Pipeline Certificate Process Gets Face-Lift at FERC

Regulations pertaining to the construction of new pipeline
projects took the spotlight at FERC yesterday, with the Commission
approving a final rule aimed at updating and streamlining the
certificate process for new projects, including a change in the
timetable for the filing of project-related environmental data.
FERC also proposed an initiative that would give landowners greater
participation in the certification process.

The companion measures unanimously approved by the Commission
include a rule that expands the scope of blanket certificate
authority for pipelines and requires them to comply up front with a
"minimum" checklist of the environmental data needed for FERC staff
to initiate a project review [[RM98-9, RM98-17]. FERC also made a
number of other changes to its Part 157 regulations and issued a
notice of proposed rulemaking (NOPR) that would require pipelines
to notify "affected" landowners within three business days of
filing their project applications.

"Since environmental review of an application consumes the
lion's share of time spent processing, following this checklist
will facilitate prompt consideration of applications," Commissioner
William Massey said. On the downside, however, pipelines could face
a "potentially sterner test" when they file project applications as
a result of the "checklist" requirement, a FERC staff member noted.
"There's more potential for rejection if they don't meet the
minimum checklist, which was not there before. So [we've] put the
onus on pipelines to come up with a more complete application at
the beginning..."

Commissioner Linda Breathitt stressed the final rule will not
require pipes to submit more environmental data than they do now -
it only requires that the data be submitted up front when a project
application is filed. Those applications not satisfying "a minimum
portion of these environmental requirements risk being rejected."

The Interstate Natural Gas Association of America (INGAA)
applauded the final changes the Commission made to its Part 157
regulations, the requirement that pipelines file environmental data
up front and the landowner-notification NOPR. "We think the more
stuff we can put up front the better. It will shorten the process.
We want to do our part to speed the process up" at FERC, said INGAA
President Jerald Halverson.

In the final rule, the Commission expanded blanket certificate
authority for pipelines to include certain compression replacements
and mainline/lateral additions, provided the "increases in capacity
are incidental in nature." This was especially good news for
pipelines because it means that a lot of routine projects - which
now are being treated as major Section 7 (c) applications and
subjected to a lengthy certification process - can be built by
pipelines at their own risk and expense without prior FERC
approval.

The final rule also increased the spending limit on unopposed
construction projects that can be acted on by the director of the
Office of Pipeline Regulation from $5 million to $20 million.
Additionally, it gives pipelines the authority to automatically
abandon eligible facilities subject to obtaining written consent
from existing shippers.

Moreover, the rule requires a pipeline to submit a list of all
landowners that would be "affected" by its project along with its
application, while the NOPR calls on the pipeline to notify all
"affected" landowners by certified mail within three business days
of applying at the Commission. In the past, landowners weren't
notified of pipeline projects until later in the process - when
FERC issued a notice of intent to prepare an environmental impact
statement or an environmental assessment. The three-day requirement
would apply to Section 7 (c) projects and most blanket-certificate
projects.

Massey said the NOPR would give landowners "earlier and more
meaningful" notice of projects. He added it was "essentially
consistent" with the "thrust" of the legislation proposed by Sen.
Fred Thompson (R-TN) last year requiring pipelines that intended to
seize private property for projects to alert affected landowners by
certified mail at the outset of FERC proceedings, giving them an
opportunity to participate more fully in the process. The NOPR also
was in keeping with INGAA's proposal to notify affected landowners
when a project application received a docket number, which normally
is the day after a project is filed.

In the proposed rule, the Commission also recommended that
interstate pipelines conduct public meetings prior to filing their
project applications to "foster better information flow to the
communities," a staff member said.

The proposal "cast[s] a wide net" in defining "affected"
landowners, according to Massey. Specifically, FERC said "affected"
landowners were those whose: 1) property was directly affected by
the proposed activity, including all property subject to
right-of-way and (ROW) temporary work space; 2) property abutted an
existing ROW in which the facilities would be constructed; 3)
property abutted a compressor or liquefied natural gas facility; or
4) property was in new storage fields or expansion of storage
fields and any applicable buffer zone.

&COPY;Copyright 1999 Intelligence Press Inc. All rights reserved. The
preceding news report may not be republished or redistributed, in
whole or in part, in any form, without prior written consent of
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